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BP To Compensate Distributors For Lost Sales

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July 1, 2010

There are 1,100 BP gas stations in the country of which very few are owned and operated by the giant oil company. This is a point that has been difficult to drive home for the many local retailers who have suffered the effects of boycott efforts by consumers who are disgruntled over the damage the Gulf oil spill has caused.

Help is on the way for these gasoline dealers through their suppliers, some of which have reported a reduction in sales as high as 40 percent compared to last year. An article posted at Cspnet said that BP PLC is dedicating $50 million to $70 million for help to their distributors. The aid will come in the form of cash, lower credit card fees and national advertising.

More relief will go to those owners, operators and suppliers closest to the spill. The amount of help will depend on the volume of the station. The media program will be focused on a “Locally Owned, Locally Operated” message delivered through various point of purchase tools including signage, flyers, posters and radio spots as well.

John Kleine, the executive director of the BP Amoco Marketers Association told the Associated Press that the suppliers “are going to get a check” and that “they’re being given these dollars for use in their business.”

The news had at least one trade association advising its BP members to start getting their documentation ready in preparation for BP’s verification process. WMDA ( covering Washington, Maryland and Delaware) advised the BP dealers in its membership to collect sales data from the corresponding months of 2009 for all facets of their operation including food sales and service income. The email also encouraged the members to approach the process with a positive attitude.

There may be another avenue available to BP dealers. Debra Reed, a BP spokesperson, told AP that the $20 billion in the escrow account and in the control of a federal administrator is open to anyone who feels they have a claim. The validity of the claim would be determined by the overseer.

Kleine said that because of the size and the varied business impact of the incident BP chose the local distributors due their intimate knowledge of this business sector. It will be their decision on how to use the funds.